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Maximizing your utility since 2013

Science, politics and religion have often been intertwined over the course of history. Think of the Muslim Golden Age and the subsequent lack of tolerance for science in the Muslim world, or the Roman Inquisition and its effects on people like Galilei. For a more recent example, one can look at the US where the religious right likes to stall advances in science (e.g. creationism, stem cell research, climate change denial).

Why is science sometimes the enemy of, other times tolerated by the church? Why do the US and European political landscapes differ so much, with the former much less enthusiastic about redistribution and much more willing to let religion influence politics? And how does income inequality affect the dynamics between science, religion and politics? Read on to find out.

We all know sleep is essential to ensure we have enough energy during the day. Yet a lot of people suffer from sleep deprivation. This can be a huge issue as it can lead to lower productivity and lack of alertness, which may even culminate in lower economic growth.

But forget about economic growth for the moment, let’s concentrate on something that individuals may care much more about: life satisfaction. Does sleep duration affect life satisfaction? You bet. In fact, it turns out the average individual sleeps about an hour less than what would maximize their life satisfaction.

Natural resources are a special kind of property, because in a sense they belong to the public. But their extraction is also possible by private corporations. There are in fact pros and cons to both. Private ownership has been shown to be more efficient and more profitable. But public ownership may be better at benefiting the region or country the resources are located in.

Of course, efficiency and profitability are important, but a country’s goal should be to maximize the welfare of its citizens. So what happens if we take a look at the effects of resource ownership on economic growth? Is private ownership still preferable to public ownership?

Dishonesty perpetuates everyday life, especially in the form of small cheating that happens on a massive scale. Think of using public transportation without paying, cheating on taxes or stealing from the workplace. Cheating can cause larger scale problems as it can undermine trust, which is well-known to be associated with e.g. economic growth.

But cheating is heavily context-dependent. People are more likely to cheat in certain situations than in others. The question that then arises is in what contexts cheating is more common, what settings lead to more dishonesty.

Making teacher salaries contingent on teacher performance can theoretically lead to better student outcomes. On the other hand, it can incentivize cheating (by the teachers) and teaching to the test. Interestingly, no long-term study of teachers’ pay-for-performance schemes has been conducted until quite recently.

In this post, I’ll look into the first study that investigated the effect of merit-based teacher pay not only on student performance in high school, but also on post-secondary and labor market outcomes.

Returns to education on the labor market are sizable and have been growing. But is this the case for illegitimate activities as well? Do criminals have positive returns to education? On the one hand, less educated individuals are more likely to become criminals. But this doesn’t preclude the possibility that more educated criminals be more successful.

Of course, crime is a rather loose definition that includes a variety of activities. One could expect that there is no returns to education in certain criminal activities. But what about organized crime? Setting up rackets is like extracting optimal rents, loan sharking requires risk management, and drug dealing involves setting up a supply chain. It can be reasonably expected that education pays off in organized crime.

It is a fact that kids from more advantageous backgrounds have better life outcomes: kids whose parents are richer and/or educated are themselves more likely to be rich and educated. Why is this the case?

Of course, there is a lack of social mobility involved: rich kids have better opportunities. But today, in most developed countries, poor kids have the very same opportunities in theory. This is because education all the way through high school (and in many countries even beyond that) is free or heavily subsidized. What is it then that makes kids from a more advantageous background more successful? On what dimensions do these kids differ from disadvantaged ones? And does socioeconomic status matter once we account for these differences?